When the firm in the figure above maximizes its profit, it earns an economic profit of
A) $3,125.
B) $6,250.
C) $9,375.
D) $5,625.
E) None of the above answers are correct because the firm incurs an economic loss.
B
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Critically evaluate the following statement. "I am definitely in favor of free trade but only if it means fair trade."
What will be an ideal response?
The discount window is a:
A. lending facility that allows any bank to borrow reserves from the Fed. B. lending facility that banks can use at specified times to borrow reserves needed to meet reserve requirements. C. term used for large banking transactions that are associated with lower risk, and therefore qualify for lower interest rates. D. term used for when large banks offer a lower interest rate for attracting more borrowers.
When a tax is placed on the sellers of a product, buyers pay
A. more, and sellers receive more than they did before the tax. B. more, and sellers receive less than they did before the tax. C. less, and sellers receive more than they did before the tax. D. less, and sellers receive less than they did before the tax.
If all existing firms and all potential firms have the same cost curves, there are no inputs in limited quantities, and the market is characterized by free entry and exit, then the long-run market supply curve
a. is horizontal and equal to the minimum of long-run marginal cost for each firm. b. must slope downward. c. must slope upward. d. is horizontal and equal to the minimum of long-run average cost for each firm.